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Writing Assignment #2: The Natural Rate of Unemployment

1. (2 paragraphs) Has the U.S. economy achieved approximate full employment yet? Explain

how we define ‘full employment’ and how you can tell whether or not that goal has been

achieved. Use appropriate data to support your answer (see below). Be sure to cite the sources of

your data in your essay.

 Use the Federal Reserve Bank of St. Louis’ estimate of the Natural Rate of

Unemployment (short-term) at http://research.stlouisfed.org/fred2/series/NROUST Drag

your cursor across the graph to find the estimate of the natural rate of unemployment for

the first quarter of 2017 (2017 Q1). (The graph shows estimates of the natural rate from

1950 to 2024).

 Use the Bureau of Labor Statistics website (bls.gov) to find the most recent estimate of

the actual unemployment rate.

2. (3 paragraphs) Read the Introduction to the article “A Search and Matching Approach to

Labor Markets: Did the Natural Rate of Unemployment Rise?” by Mary C. Daly, Bart Hobijn,

Aysegul Sahin, and Robert G. Vallet. (Read pages 3, 4, and 5 of the original document (= the

first three pages of the pdf file)). How do the authors explain the increase in the Natural Rate of

Unemployment during and after the financial crisis (from 2007 to 2012)?

Grading Rubric The table below shows the criteria your essay will be judged against. I expect about five paragraphs,

double-spaced. Your essay will be assessed as either ‘Meets expectations’ or ‘Needs improvement’

on each of the five criteria in the table below. If your essay meets expectations on 3 of the 5 criteria,

your score will be 60%; 2 out of 5 criteria met will result in a score of 40%, etcetera.

After receiving feedback from NetTutor, you have a week to revise and re-submit the essay

to NetTutor for another try – but you only get one second chance on each writing assignment. If

you don’t get an acceptable score, even after revising and resubmitting this assignment, you can still

rescue your writing assignment average by doing well on the next two assignments. I will take the

average of your three highest writing assignment scores to compute your writing assignment

average.

5 Criteria Needs Improvement Meets Expectations

Writing

The writing is difficult to follow and/or poorly organized. Transition sentences are absent or ineffective. Typos and/or grammatical errors distract the reader.

Ideas are well-organized. Transition sentences effectively connect one idea to the next. The essay is free of typos and grammatical errors.

Application of

economic

analysis

The definition of the term full

employment is vague, incomplete, or

incorrect.

The definition of the term full

employment is thorough and correct.

The student draws the wrong

conclusion from her comparison of the

actual and natural rates of

unemployment.

The student draws the correct

conclusion from her comparison of

the actual and natural rates of

unemployment.

The student does not identify the

reasons for the changes in the natural

rate of unemployment from 2007 to

2012, or does so incompletely or

incorrectly.

The student discusses the reasons for

the changes in the natural rate of

unemployment from 2007 to 2012

completely and correctly.

Analysis of

data

The student inaccurately reports the

natural rate of unemployment and/or

the actual rate of unemployment, or

does not cite the source of the data.

The student accurately reports the

natural rate of unemployment and

the actual rate of unemployment and

cites the source for both.